§ Mr. Ron Daviesasked the Chancellor of the Exchequer what has been the effect on the income of a family of four on average earnings of the changes in the level of income tax and value added tax, respectively, since 1979.
§ Mr. Norman LamontFigures for 1978–79 and 1986–87 are shown in the table.
1978–79 1986–87 £/week £/week Average earnings 92.80 213.40 Income tax net of child benefit 13.32 27.36 VAT 2.42 10.22 The figures are for a family on male average earnings, with wife not working and with two children under 11. The level of average earnings in 1986–87 is illustrative and assumes 7–5 per cent. growth on 1985–86. Figures for income tax alone are not strictly comparable since 1978–79 figures are affected by child tax allowances. For information, income tax was £18.46 in 1978–79 and £41.50 in 1986–87. The estimates of VAT are derived from the 1985 family expenditure survey.